Reserve Bank of Malawi

Micro-Finance & Capital Markets Supervision

Introduction

The Microfinance and Capital Markets Supervision department is responsible of regulating and supervising microfinance inclusive financial cooperatives and capital markets financial institutions.

Mission Statement & Vision

The Microfinance and Capital Markets Supervision Department exists to contribute towards achievement of Reserve Bank of Malawi's objective of promoting sound and stable financial system in Malawi. As a department, we aim at supervising microfinance and capital markets institutions to ensure that they are operated in a sound and viable manner so as to develop and maintain public confidence in the financial sector. In this regard, the department's primary responsibility is to protect the interest of the public by administering a regulatory and supervisory regime that is in line with generally accepted international standards that promote transparency and fairness in the operating environment and encourage microfinance and capital markets financial institutions to confine their risk taking to acceptable levels.

In pursuance of the mission statement outlined above, the department performs its work with professionalism, integrity, impartiality, and in a friendly and cooperative manner but without compromising its authority or mandate.

The department has six key result areas namely:

  • entry control
  • on-going supervision
  • policy development
  • enhancement of competition
  • consumer education and protection
  • exit administration

All these areas cut across the two divisions of the department, microfinance on one hand and capital markets on the other.

CONTACT US

The Director, Microfinance and Capital Markets Supervision
P.O. Box 565
Blantyre
Phone: 01 820299/444
Fax: 01 830 628
Email: mcsu@rbm.mw

Supervision of the Micro-Finance

The Financial Services Act, 2010 and the Microfinance Act, 2010 are legal frameworks that govern the regulation and supervision of microfinance sector in Malawi. In addition to the laws, Guidelines and Directives on various specific issues are issued to complement the laws.

ONGOING SUPERVISION

The division monitors performance of microfinance institutions through continuous off-site surveillance of all licensed microfinance institutions using financial statements and other operational information submitted by the regulated institutions on a periodic basis. The department also conducts periodic onsite examinations mainly as a follow up on to the off-site findings.

Regulatory Framework

Licensing Requirements
Financial Cooperatives

The department is also entrusted with the responsibility of regulating and supervising financial cooperatives. Registration of financial cooperatives is done by the Registrar of Cooperatives under the Cooperatives Societies Act, 1998 while licensing is done by the Registrar of Financial Institutions under the Financial Services Act, 2010. The Financial Cooperatives Act, 2011 is the legal framework that governs the operations of financial cooperatives in Malawi.

Regulatory Framework

Licensing Requirements
Document Title Released
 Provisionally Licensed SACCOs Nov 06, 2014
Supervision of Capital Markets

The Financial Services Act, 2010 and the Securities Act, 2010 are the legislative frameworks that govern the regulation and supervision of capital markets. Under these legal frameworks the Registrar of Financial Institutions is mandated to license and supervise the securities exchanges, brokers, dealers, portfolio managers, market makers, investment advisers and underwriters.

The key regulatory objectives are to protect investors, ensuring that markets are fair, efficient, and transparent; and reduce systemic risk. In this regard the division ensures that all capital market institutions observe high standards of commercial honour and apply just and equitable principles of fair trade to ensure maintenance of fair and orderly market. The division also examines trading practices in the capital market to ensure prevalence of fair, orderly and efficient market conditions and; ensures that investors are adequately protected in order to maintain confidence in the capital market.

ONGOING SUPERVISION

Regulatory Framework

Licensing Requirements
Consumer Education